They might sound funny when they talk, but those Minnesotans sure know how to run a retail electronics empire. Shares of Motley Fool Stock Advisor recommendation Best Buy
Here's why: Revenues were up 21% for the fourth quarter and 17% for the year. Best Buy now sells $24.5 billion worth of goodies per year, double what it was peddling five years ago.
Earnings for the fourth quarter advanced 22% -- after backing out a one-time loss from the year-ago period -- to $1.42 per share. For the full-year's numbers, there were plenty of charges for discontinued enterprises, but comparing diluted earnings per share from continuing operations shows a 28% uptick, to $2.44 per share. (This year's generally accepted accounting principles (GAAP) number is $2.15.)
Wading through the numbers and flipping over rocks to look for scary surprises -- a common pastime in Minnesota, yah -- yields very little. Comps had a healthy rise, margins improved, and while SG&A ticked up slightly, it was nothing to scream about. Last quarter, the firm started paying dividends, it has been repurchasing stock, and despite those payouts, it now sits on $2.6 billion in cash.
Its static appliance sales notwithstanding, Best Buy is really starting to look like one of those boring super-success stories that constantly improve, like Starbucks
Valuation is probably the only concern for investors. With the firm aiming for 15% to 20% earnings growth for the next year, at $51 per stub, the stock trades this morning at 17 times forward estimates of $2.87 per share. That may not scream bargain, but it looks like a reasonable price to pay for a slice of one of the world's premier retailers.
David Gardner recommended Best Buy for subscribers of Motley Fool Stock Advisor . To find out which other companies are in David's lineup, you can sign up for six months with a money-back guarantee.